Going to be in deep trouble ! Had a TAx Credit check letter

[Completefool]

I everyone this my first time on the Forum

I am in a complete state and hope can get some words of advice . I have just received a Tax CRedit check letter. They are asking me for details on my Self Employment for the period of 1st Jan 2012 to 31st March 2012. They have asked for my Self employment Ref No , details of my business , invoices details of advertising and information on NI contributions and hours I worked.

I have been claiming Tax Credits as self employed for last 4 years and have not registered as Self Employed with the tax office!!! I have buried my head in sand and have put it off and off! My affairs are in such a mess and any estimate and earnings I have given to tax credits over the years are not accurate. I am so so scared and all my fault and had lots of personal problems , depression , divorce abuse and Father dying I have lived in a fog for so long. I am now in a wonderful relationship and about to live with my partner any day now and wanted to end my Tax Credit claim and put right my Taxes and face the penalties. Now this letter has forced my hand anyway. My boyfriend has no idea and is a respected buisness person. I am scared my children who are my life and I am theirs will suffer and I will have to go to prison or be in the press for fraud.. At this point I think they only have to do a bit of digging and will know I haven't claimed accurately. I may have under estimated on a few years but maybe not all. I also claimed child care for over a year at wrong rate and didn't tell them. I did amend this about a year ago. I was always late in calling the Tax office with details and have always been under impression you could never just CANCEL your claim ! And would look into it further if you did which scared me also as I knew I was just fluffing my whole income details..... I am terrible when it comes to my own affairs and spend most of my time dealing with my families affairs which I manage without problem . My brother and sister suffer from chronic depression and I also suffer but avoid anything that is a potential problem when it comes to me.. I am in a terrible mess. I am worried for my children desperately. Do I ignore this request for information and let them cancel my claim and pay back the last years Tac Credit (2011/2012) in the hope that they don't go over the other years ???? Or will they see I have no Self Employed status and investigate my years previous??? In the mean time I am actually going to appoint a accountant and submit late returns to the Tax man for last 3/4 years and face the Penalties.... This sounds like I'm trying to get away with what I have done which I guess it is but I can't cope with thought of investigation going on for years and years.... I just don't know what to do. Can anyone give me advice or give me their story ????

[rebel11]

Hi com

 

Welcome to CAG

 

The guys will be happy to advise as soon as they are available.

 

Please let us know how your problem has been resolved, it could help fellow Caggers.

 

Thread has been moved to the correct forum.

 

Don't panic sometimes things seem a lot worse then they actually are. What you need to do is put everything down on a spreadsheet so you can calculate any over payment and rightful entitlement, thats a starting point.

[Completefool]

Hi rebel11

I'm new to this and hope people will be able to see my post... Thanks for your reply. I will start to at least put the last 4 years down on spreadsheet... I am just frantic... What a fool, Ii is going to be much harder to deal with this than it would have been to face in first place.. I just don't want to effect my children or them find out their mum is in trouble it would wreck them .. They rely on me solely for everything... I hope I hear from people soon.....

[Completefool]

If I ignore their letter , it states that if I don't reply by 26th May they will amend my claim and deal with it based on the information they have and amend my working hours or will stop my claim and I will have to repay the full amount, I am thinking if I do ignore it and I will pay it all back will they leave it at that ??? I don't want to claim anymore as I not working 16 hours now and about to move in with my boyfriend... I am feeling so scared for my children ... No body knows of my situation I am ashamed for burring my head over and over...

[Nystagmite]

don't want to claim anymore as I not working 16 hours now

 

You may still have an entitlement to child tax credits.

[Completefool]

I know I could possibly be entitled to it but I fear the investigations and if they start looking into my previous years also.... I would rather them cancel my claim for 2011/2012 if I don't reply and have no further claims.... I just can't cope with the contact sounds pathetic I know.... I just not functioning and my children are noticing.. Anyone have any advice from own experiences when they not replied to there letter ???

[jadeybags]

Trouble is, the tax office know you have been self employed for 4 yrs, as you have been claiming that case through tax credits?I am a bit amazed it's taken them this long to check? I have just registered self employed & updated tax credits & as soon as I receive my UTR (I think it's a unique tax reference number thingy) I have been told by tax credits they want to know it. It almost sounds like they failed in their duty of care with you?

[Completefool]

They have never once asked me for or even said you must give us a UTR. I have never once heard anything from the actual Tax office !! I am going to submit a tax return for past 4 years and pay any tax owed etc... Has anyone ever experienced this for such a long period ?? For 3 years in the last 3 I have never even received a renewal form etc and only was reminded by the adverts on tv.. Not that this has any relevance... When you say duty of care , should they have been aware of this ?? Thank you . Worried sick. !!! My fault !!!

[honeybee13]

Hello there.

 

I'll move your thread to the HMRC subforum, which is where tax credit queries are dealt with.

 

My best, HB

[Completefool]

They have never once asked me for or even said you must give us a UTR. I have never once heard anything from the actual Tax office !! I am going to submit a tax return for past 4 years and pay any tax owed etc... Has anyone ever experienced this for such a long period ?? For 3 years in the last 3 I have never even received a renewal form etc and only was reminded by the adverts on tv.. Not that this has any relevance... When you say duty of care , should they have been aware of this ?? Thank you . Worried sick. !!! My fault !!!

 

 

Dear honeybee

Will I still be seen by other people experiencing Tax Credit Compliance Checks ??? thank you

[susi72]

Bear in mind you cannot cancel your tax credit claim now they are investigating. The following advice I give not to scare you, but because you really need to understand the gravity of the situation you are now faced with:-

 

If you don't reply to the letter then you will make a very bad situation extremely worse.

 

I think you are very lucky they are only asking for the two tax years. However; the minute they check with Self Assesment (which they will) and see you have never registered or submitted tax returns AND you have mislead them about other things besides your income you will probably find they look into other years or at least start questioning you about them. They don't tend to do this unless the case is severe and this is.

 

I think you are being very naive if a) you are considering not even replying and b) that the only penalty will be removal of your tax credits and the repayment of them and penalties. This will also be disclosed to other benefit offices like the council to ensure you have not mislead them either. I understand you are frightened, but this has gone on for a long time repeatedly and when you would have returned your renewal you must have continued to give false information - self employed (you were not because you had failed to register as the guidance states, income, childcare)

 

Not only have you admittedly fraudulently claimed tax credits but you are by the sounds of your post possibly guilty of tax evasion if you have not paid any tax due back. Tax credits normally proceed down a non-civil route ie - not in court with prosecution. It is a completely different matter for Self Assesment and tax evasion, if you have had profit above the threshold that would have meant paying contributions or tax then this is tax evasion. The penalties involved for not returning your tax return are severe for someone who takes a year but 4? You must remember that although they can listen to you about personal problems and take certain things into account, they hear this all the time from people who have made mistakes and I think in your case the problem is how long this has gone on. It only takes looking at when you reported you were self employed to tax credits and one call to S/A to find out if you were claiming WTC all that time.

 

If I was yourself I would firstly get serious professional help, and consider at some point possibly a solicitor, you will need one if called to interview (now this doesn't happen often in tax credits as they seek repayment primarily through a civil means, but as I said this is Self Assesment too).

 

Start putting everything down as much as you can and co-operating with them as fully as you can. Non-compliance will bring in even more penalties. If I were you, I would consider admitting the four years if questioned. If you are questioned, they will ask for dates etc, the minute you start going back only two years you have covered something up and I believe in this case it will be discovered. Try and look at your post again - you admit you have been a fool and come clean but you admit also you don't want to be found out for the other two years. It is keeping the pattern of being evasive going. Please get serious help and advice - immediately.

[Completefool]

Thank you suzi for your advice

I do want to put it right and I am just extremely frightened. I spoke to a solicitor today and they said they only act if I am interviewed and I tried to call the CAB but couldn't get through... Can I just ask are you a professional in this field ? Do you think I should also appoint a accountant asap ??

[jadeybags]

I would appoint an accountant, 4 yrs of accounts is a complete mission. I made the mistake of volunteering to do 2 yrs worth for an ex a few years ago, & it nearly sent me insane tbh. And said i'd never do it again. I agree with the above post. Tax credits could say you weren't actually working at all, in which case want all the last 4 yrs WTC back, or the tax office will want to know where the 4 tax returns have gone? There can't be an in between can there. If that made sense.

[Completefool]

Thanks for your advice

I really want to put right my Taxes with HMRC and am willing to sit and do the accounts and appoint a accountant asap... It only really 3 years I have just worked out that I am actually late in submitting (not that it makes it any better) !!! I did say earlier about not responding to the Tax Credit check letter from the Compliance Team. I only really said this as it does state on letter they will make their own determination if I don't and I may have to pay back the award. I only said this as I just too frightened to speak to them and in that case still wanting to avoid confrontation !!! I only hope I don't get sent to prison. I think I would rather die than face the shame but couldn't do that to my kids or family. Otherwise I would contemplate it. I regret totally being wrapped up and not attending to my affairs like a normal person would....

[susi72]

Thank you suzi for your advice

I do want to put it right and I am just extremely frightened. I spoke to a solicitor today and they said they only act if I am interviewed and I tried to call the CAB but couldn't get through... Can I just ask are you a professional in this field ? Do you think I should also appoint a accountant asap ??

 

 

Hi, no a solictior would be a consideration and only if you are questioned - you may only be asked about the relevant years and not need one so a consideration for now.

 

Yes I would appoint an accountant, as jadeybags said it is alot of work. My husband is self employed and he used to do his books himself but after a couple of years realised it was better to pay the fee and have it done properly because I wasn't doing it all for him - his receipts were in the thousands number-wise.

 

To answer your question - yes and no. I left HMRC a few years back but was with them a very long time working in various departments - Enquiry Centres handling face to face enquiries and then onto tax credits for a while when they started closing the enquiry centres down. I can advise you the best I can that I think would be in your interest without breaking any rules but only you can decide what to do with the information given to you.

 

My main point would be is that you are taking initiative now, don't hide from this or bury your head in the sand as it only makes things worse. Just try and get an accountant on board. If you need extra time, write a letter to the Officer dealing with your case and explain why you need an extension and supply whatever you can to see if they will allow the extra time. Just try and be as honest as you can, if you are seen to be co-operating and not being evasive it will look much, much better for you.

 

And finally - good luck, ask any questions you want, if I can answer them I will try my best. And finally, put prison out of your mind - this for gravely serious cases. Don't be afraid to talk to them, explain you are frightened - trust me when i say this - although many people call them Nazis etc, at the end of the day they are human beings who go home to families themselves, I never ever treated anyone as if I was interrogating them. Just be honest and tell them you have made a mess and things have got on top of you. Come back to us if you are not treated fairly because you can complain if you feel your treatment is unjust.

Edited April 30, 2012 by susi72
little extra at bottom

[joeblogs]

Absolutely agree with Jadeybags and susi72, shop around for an accountant who you feel comfortable with. Ask around for recommendations. Make an urgent appointment to see him/her and explain fully what you have written on here. You really need an accountant to help and assist you with this situation, and they are used to dealing with HMRC.

 

I urge you to find yourself a good, sympathetic accountant who will help you all the way to sort this mess out for you.

 

Good luck.

 

JB

[Completefool]

Thank you so much everyone for your advice... I am going to call accountants today and make a start on my accounts. I am going to try my best to get through this and only wish I could understand why I didn't just ask for help years ago !! I am totally relieved for my children and mum that I shouldn't go to prison over this. I will keep you informed along the way as I know it useful for others. I know I not the only person who has done this type of thing. I just wish I hadn't. I have never been so foolish in my life before.... Thank you for your support and non judgement of me ))

[shadow2007uk]

I have review letter and CAB advised i admit in a letter i made a mistake and reasons why other than im a idiot . Would any of you ladies do this or call them ???

Thx in advance x

[Completefool]

I have review letter and CAB advised i admit in a letter i made a mistake and reasons why other than im a idiot . Would any of you ladies do this or call them ???

Thx in advance x

Hi Shadow200

What did your Review letter ask ?? What are your mistakes ??

[shadow2007uk]

It said we have found another adult may be residing at your home mr **** do you know him and please ive us a reason as to why you did not claim jointly .

I have wrote to them and will post recorded delivery today .

looking at 2011-12 so far

What did yours say luv

[johnvernon74]

What work were you doing? What sort of money did the business turn over. In reality you could do 2011/12 online yourself rather quickly and easy. For the previous 3 tax years, Im sure that you will be able to have bank statements showing income and what you paid yourself less expenses. Once you have done all this then I would submit to tax office. They will fine you for past 3 years (which you can appeal). As for Tax Credits, give them the information they have requested past 3 months - up to 31st March 2012. Give them that 3 month information. Call HMRC and register for self employment. Fill in 3 years tax return (download of HMRC).

 

I dont think this is as bad as you think, they have requested 3 months at this stage. Send that to them and take a weekend to sort out the other 3 years. My view not a problem.

 

I was in same situation with Disability Working Tax Credits that was from 2006 onwards. Now all sorted - HMRC fined me £100 for late return for each year but I asked them to weave and they did.

 

Good luck.

[Completefool]

HI Johnvrnon,

I greatfully appreciate your advice.... I have looked after Rental Properties only as a one man band just for a few people i know really.. I also looked after a few of my boyfriends also... I now only actually look after 3 Properties and my Income has dropped .. My boyfirend has subbed me over recent months as i do look after him and parts of his business. I would have never said i work for him but i guess i have in some respects... Anyway i have earnt probably around 10-12k a year.. To be honest i have never got a exact figure or even really thought of expenses.. I never really had a lot of expenses, what could i class as that ? Petrol maybe ? Once i look at my accounts i think with a little work i can figure it all out... I just gave Tax Credits an idea of what i earned over the phone !! Cringe !! I am just soooo terrible when it comes to things like my money affairs, i also just got worse because i didn't do it all by the book correctly from the beginning.. The Tax Credits i think are on to me as my hours i claiming are still 30 and i last told them my income was low now.. It probably doesnt add up to them and they have then maybe checked obviously for the first time that i havent registered as self employed!!! They are asking me for my Tax ref number etc when they must quite clearly know i don't have one !!! Will they not think i a big blagger if i now register online etc and can i submit 2011/2012 online now ?? I do agree with your advice and think this is what needs to be done obviously.. Then get the last 3 years sorted for the Tax man (they not conntacted me but i sure they would eventually ) I want to submit accounts before they ever do contact me and pay the fines... I have just put this off and off !!! So basically i have not been accurate i have been pathetically un organised !!! the only one other thing i crapping myself about is i claimed childcare for about 2 years at a higher amount than i was paying.. I did change the childcare amount about 6 months ago... crap i just feel so bad !!!! Oh yes and they asked me to send back my Annual decleration also to them...rather than sending it back to the usual place and by the usual end date.. They want to hear from me by 26th May ...Sorry to go on and on ...

[lis79]

It said we have found another adult may be residing at your home mr **** do you know him and please ive us a reason as to why you did not claim jointly .

I have wrote to them and will post recorded delivery today .

looking at 2011-12 so far

What did yours say luv

 

Hi

 

Just wondered, did you claim prior to 2010-2011 (i.e.2009-2010) also? I'm just trying to work out why they are generally asking for 2010-2011 and 2011-2012 and no previous years.

In other words when did the claim begin?

They say to some people on net mums that even though they know the previous tax years are also wrong, they are not asking for them back. It's like they want you to keep some money for the time being, so maybe they can come back and punish people more severely in time to come - maybe when the investigation procedure has become harsher in 2013?

[shadow2007uk]

its around 10 yrs

just asking for 1 yr so far . Hope this is not the case cant go through this stress again .

I have advised them in the letter i don not want to claim jointly as we are not a couple . Im not dealing with them ever again lol

How many yrs is urs going back and have you heard of anyone being sent to court i havent but im stressing still . Awaiting letter now but will keep u updated cuz no one on here tends to do that which would of helped me and others put our minds at rest

[Completefool]

Hi Lis79

 

They are asking me dtails regarding my Self employed nature etc only for a 3 month period in my 2011/2012 claim, but they surely know that my previous years will not be completely accurate but at this stage they not asking for that.. They may of course... When you say the investigation procedure is harsher in 2013 what do you mean?? And do you think they would be sneeky like that and wait to pounce at a later date ???